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Extant (optical) networks normally offer two degrees of service reliability: full protection in the presence of a single fault in the network, and no protection at all. This situation reflects the historical duality that has its roots in the once divided telephone and data environment. The telephone circuit oriented service requires protection, i.e., provisioning of readily available spare resources to replace working resources in case of a fault. The datagram oriented service relies upon restoration, i.e., dynamic search for and reallocation of affected resources via actions such as routing table updates. The current trend in networking, however, is gradually driving the design of networks toward a unified solution that will jointly support traditional voice and data services, as well as a variety of novel multimedia applications. The growing importance of concepts, such as quality of service (QoS) and differentiated services-which provide multiple levels of service performance in the same network-evidences this trend. Consistently with this evolution, the concept of differentiated reliability (DiR) is formally introduced in the paper and applied to provide multiple reliability degrees (or classes) at the same network layer using a common protection mechanism, i.e., path switching. According to the DiR concept, each connection is guaranteed a minimum reliability degree, or equivalently a maximum downtime ratio, that is chosen by the client. The reliability degree chosen for a given connection is thus determined by the application requirements, and not by the actual network topology, design constraints, robustness of the network components, and span of the connection. An efficient algorithm is proposed to sub-optimally design the wavelength division multiplexing (WDM) layer of a ring and illustrate the advantages of the DiR concept.